Good afternoon, good morning, and welcome to our video conference presentation for our second quarter results for Stolt Nielsen Limited, which we are streaming live from our office in London. My name is Nick Stolt Nielsen. I'm the CEO of Stolt Nielsen Limited. Together with me, as always, I have Jens Grinehage, our Chief Financial Officer. And I'm very pleased to also inform you that this time, Lukas Voss, our President of Stolt Tankers, is joining us and will present the Stolt Tanker part of the presentation.
I'd like to remind you that you can post any questions anytime during the presentation. There's a Q and A section up on the upper right hand side of your screen. You can post them, and we will answer, hopefully, all of the questions at the end of the presentation. So let's then move on to the presentation. If we go to the next slide.
Following the next slide, please. So the agenda, I will go an overview of Stockton Nielsen. We will talk a little bit about ESG, then we'll go through each of the businesses. Jens will take you through the financial highlights, and then we will try to respond to the questions that you post. Next slide, please.
So second quarter highlights. The utilization is up, as we reported, but profits are still lagging. Net profit for from continuing operation came in at $7,800,000 The increase in EBITDA was mainly driven by the record number of shipments that we saw in Stolt Tank Containers. We saw an increased activity and high utilization at Stolthaven Terminals. We saw a slight improvement in the utilization in Stolthaven tankers.
We had lower results in Stolthaven, and that is due to the lower volume that we sell sold in the second quarter as the first quarter is the strong quarter with the Christmas sale. We improved our free cash flow due to lower capital expenditures. Jens and his team completed a $77,000,000 financing that secured by the three CTG ships that we bought last summer. And we also leased in an additional 600 new tank containers. At the end of the quarter, we had $397,000,000 of available liquidity, and we paid out the dividend on May 5 of $0.25 per share.
Looking at the operating revenue, 526,900,000.0, that's up from 180,200,000.0. EBITDA up CHF 116,700,000.0, that's up from 109,200,000.0. Operating profit also up from CHF 36,000,000 to 41,000,000. And I already mentioned the net profit. And also here is the free cash flow of CHF 20,000,000.
As free cash flow is then after our capital expenditures and interest expense, so generating a free cash flow for the quarter. And tangible net worth rose slightly from 1,636,000,000 to up to $1,642,000,000 Next slide, please. If we do then the net profit variance and compare 2021 to second quarter, how we got there, you can see that we had a slightly lower operating profit from Stolt Tankers. We had a significant improvement in Stolthaven of 2.6. STC with its record number of shipment came in at an increase of operating profit of 4.5.
Lower operating profit from Stiefarm, again, the second quarter, lower volume because of the Christmas sale in the first quarter. Stolt Nielsen Gas is still in the development stage, but that came in at a lower operating profit of 1.1%. Corporate and others, 1.3%, mainly due to lower accrual for the profit sharing on short term incentive. We had a lower operating lower net financing expense of over $1,000,000 some FX change and slightly higher income tax, bringing the net profit for the quarter to $7,800,000 Next slide, please. ESG, as we promised, we better at reporting what we are doing.
At Salt Nessen, our goal of zero harm for people and the environment is our number one priority. We believe that we, as a corporation, as a company, even though we transport a lot of we even though we consume a lot of fossil fuels in what we do and the products that we transport is created very much from fossil fuels, it is our responsibility to do what we can do to contribute to a more sustainable future. We have mentioned on the right hand side before our targets. It's a for tankers, it's reduction at least 50%
of our carbon intensity relative
to the 2008 levels, and that's we want to achieve by 02/1930. In terminals, there's a primary activity to be carbon neutral by 02/1940. And STC, so tank containers, 2,030, 50% of the energy and utilities consumed in our depots will come from renewable energy sources. And the sea farms zero waste to landfill by 2,030 and also to reduce our dependence upon fish oil and fish meal by finding substitutes in the feed. Installed tankers, we have actually been doing some trials with biofuels on our ships from operating in Rotterdam to use the TAW service.
Installed tankers has also joined the Maersk Mekini Merloo Centre for Zero Carbon Shipping as a strategic partner, working together with other operations. Santos Terminal in Brazil has been named as one of the top three bulk liquid terminals in Brazil by our customer Raisin. The award was given based on safety, processes, productivity and controls criteria. And so Tank Containers retained its silver sustainability rating from EcoVadis, and Stolt Sea Farm successfully completed an annual food safety audit for global GAP and SAE. And next slide, please.
And then I'll give the word to Lucas.
Thank you very much, Niels, and thank you for having me in this, in this session. I'd like to take you through the second quarter for Stolt Tankers. So if I can have the next slide. Think if I look at the Stolt Tankers overall, quarter was marked by substantial higher volumes, but unfortunately, lower spot rates. So our operating revenue has gone up with around 27,000,000, which is great.
However, you do not yet see it coming back in our EBITDA numbers and our operating profits. It is on the back of substantial higher operating days, as you can see here, and that is very much driven by the five CTG ships that Niels was already mentioning at the beginning of the of the presentation, which has come into the fleet in quarter one and have been fully operational in in quarter two. The utilization therefore has gone up with 1.4%, but the main drivers are the the rates and and the bunker prices, and I'll come back to that on the on the next slides. Maybe one more item to mention on these slides is that you can see that our owning expenses have gone up partially because of the CTG ships, but also partially because we have decided to advance some of our dry dockings to because it's a it's a relatively weak market, getting done right now so that we are well placed for hopefully a pickup in the market when we get there later in in the year. If I can then have the next slide, you will see that the higher bunker costs have been a big hit on our numbers.
Overall, prices have increased around somewhere between 2560% depending on how we look at it. Consumed was 25%, purchased was around 16%. But you see that our overall costs have increased with only 7%. What is the differential there? The difference really is that we have a natural hedge in our, through our contracted volumes.
So 93% of our contracts with customers, they have a bunker hedge, which means that around 62% of our total volume is protected against the increases in bunkers. However, that's not the whole explanation. It also is a show a sign that the internal cost saving program that we have now been conducting for the last two years and which is primarily focusing on the bunker consumption, but that is now paying off. So we have been reducing our speeds. We have been optimizing the trim of the ships.
We have been purging bunkers in lower locations, and we have made sure that the optimal routing is continuously maintained. And we've done so by centralizing this function altogether in Botelein. So bunker costs are up, but we have a lot of mitigating factors in this to make sure that it doesn't hit us our bottom line to the same extent. The other factor is, the prices. If I can have the next slide, please.
It's the market circumstances. We've seen our volumes, our contracted volumes, slightly lower than we normally have at the 62% level, whereas in quarter one, we were still at the 71% level. It's not an overall sign of weakness in the markets. It's not that at all. There are some conscious choices, and there are some unfortunate events in here.
One of them is also mentioned on this slide is the, cold snap that we saw in Texas or the Houston freeze as we tend to call it. It has overall cost us around $5,000,000 in the bottom line. And because of our voyage accounting, most of that falls in quarter two. The impact there is 3,900,000.0 as you can see, and that is very much a contract involvement. We have also stopped calling the West Coast Of South America where we had one contract with the customer, which we decided not to continue.
So it was a conscious choice from our sides to reduce that that volume, and we've been impacted by some assets factory being shut down because of refurbishing, and that has also hit hit our contracting volumes. But that is the bad news, but it's not that overall volumes are low. The good news is is that my organization has shown quite resilience by getting a lot of spot volume in. Our spots volume has increased with around 45% quarter on quarter compared to the 6% decrease in contracted volume. However, that 45% increase in spot volume did come at a lower price.
So the spot prices have decreased with around 6.5%. They were already at a low. They have gone down even lower. And if you set that off against the higher bunker prices, then you can imagine that's, yeah, that's not a, necessarily a a good scenario. Overall, I think Deepsea has, I'm very happy with the performance on the volume side, and we are, well, I'll take you through my outlook for the market later.
If I look at some of our, other services, look at inter European service, I think overall, we're doing fine. It wasn't as strong as quarter one, but quarter one had a bump because of the, the pre Brexit movements that took place. And as you know, our December month is in quarter one. I'm happy with, the inland services, so our Rhine barging that takes place. Contracts are very stable.
We haven't had the low waters as we've had in in previous years, so rates have been relatively okay, but not as strong as they may have been in past years, but overall on track. Inter Caribbean service very much impacted as well by by the Houston Freeze, but they're back to their normal levels. So good performance there, and we see a strong market, strong customers in, in Asia Pacific and that also we see continuing in, in quarter three. If I can have the next slide, as I talk about quarter three already, let me take a big look at the, at the outlook. We look at, all sorts of parameters as you can imagine.
These are four important ones. Of course, the overall global GDP because, chemical volume is always a function of what happens in the global, economy. We see clear clearly, the recovery in 2021 and hopefully also continuing in 2022 and '20, '23, so that's a good sign. Underneath, you can see what that implies for the chemical traits. As you can see overall, it actually it is actually quite stable.
The growth hasn't been as good in 2020 for known reasons, of course, but it's jumping back already in '21 and continue so to do in in in 2022. So what our customers are trading, overall, that volume is is really good. But as you well know, we need now need to share it with more tonnage because we have the, MR segments or the swing tonnage as we call it also in our market because of the depressed earnings in their own markets. So we are looking at when is that starting to move, and one of the indicators there is the global crude floating storage, as you can see, which has now come back to normal levels, I would say. So, and with the economies heating up, again, hopefully, the oil pipeline will be turned open and transportation for oil will also resume and M and R, tonnage can move out to their own segments again.
If you add on top of that, in the left hand, left top quarter, the supply and demand order book for our segment, it is still very favorable and also as you can see in in years ahead. There is very little ordering, going on, which I think is a healthy sign for a good recovery. So I would say longer term, I see a lot of signs on green for a good recovery in the market. And I, of course, look very diligently to our own asset composition, and I can show you on the next slide. There we have also had some interesting developments over the couple last few months.
We're optimizing the asset base continuously as we speak. You have seen that we've started a joint venture with Esperger called E and S Tankers in the intra European market where we now are by far the market leader leader with 48 tankers. The the joint venture is, is proving to be very beneficial for both ourselves and for Asperger. The synergies that we beforehand thought we saw are actually proven to be there and actually a little bit more as well. So the business is quite complimentary.
Our customers are really appreciating the additional services and the additional offerings that they get through this, and it still remains a good complement to our deep sea network. So overall, we're very happy with how that has been progressing. The CTG ships, I think it's been it's been mentioned already a couple of times in this presentation. The ships are fully in service. They are going from Transpacific to Transatlantic.
They are versatile ships, so they can go from the one trade to the other. And overall, are a good complement to the overall service offering that we have, and they are already returning a decent money, I would say. You will also have seen an announcement that we've made to the market around two weeks ago around a pooling agreement with Tufton. Tufton will add seven of their 19, j 19 ships to our pool. We already have one ship of Tufton on the contractual management, and there we saw that the collaboration between Tufton and Stolt Nielsen is very good, and they've decided to concentrate their ships instead of having them with different platforms to concentrate them with Stolt's tankers.
We have done a lot of work last year to renew our pooling agreements to make it more transparent and to make it more attractive for other players such join, and I think Tufton is a an evidence of that. It's for us a new market. We we it's j nineteens are not necessarily, where we are operating now, so we're not we won't see any cannibalization of our, of our contracts, but we will build up a new contract portfolio and show that Stolt Tankers is is the leading platform in this industry and will make a success out of this, this arrangement as well. If I then look at the deep sea and go to our contract portfolio, which is on the last or the next slide, I think this is the the big foundation of the Stolt Tankers. This is our true differential, I would say, compared to some of our competitors.
It is the long term relationship that we have with our customers and the, the important part that we play in their supply chain. There's a lot of talk about commoditization commoditization of this market. I don't agree, with that necessarily, particularly if I look at some of these customers and their specific requirements they have and the types of ships and the type of service that they need where I'm convinced that not many people can bring it, but Stolt's tankers can. So we have a best in class contract portfolio, on it. We also see the contract rates have increased with around 5.9% quarter on quarter, and I'm sure that we'll we'll see that coming in to the results.
Mind you, one of the maybe downsides of choosing to be so customer centric is that if there is an increasing market, we may benefit at it from it at a lower pace than, some of our competitors. But through the cycle, we believe this is the right strategy going forward and being that special part of the supply chain of our of our customers. But as you can see on our COA renewals, it has been going up steadily since quarter four two thousand and nineteen, and I'm very happy with that development. If I add that all together, I think we are well positioned, and that will be my last slide, to capitalize on the market up cycle. There's a favorable chemical tanker outlook.
We're doing everything that we can to optimize our assets and also try to grow on an asset light, in an asset light manner. We have a substantial cost saving program. Over two years, we are aiming to save $60,000,000, which I see coming through on the bottom line. It may be difficult in the overall numbers because, clearly, we're also doing other things like adding the CCG shift, but we see it coming through, in the numbers. And with that contract portfolio, I feel very, very confident that that we are well positioned to make the up cycle in in the market.
That's what I would like to give the audience, Niels. So back to you.
Thank you, Lucas. Then we go to Stolthaven Terminal. Next slide, please. So we came in with an operating profit in the second quarter of $60,600,000 That's up from 58 and EBITDA of 34,200,000.0 also up from 31,100,000.0 Operating profit coming in at $300,000 up from 15,700,000.0 And utilization went up from 88% to 90%. If we do the operating profit variance, again, higher revenue because of the higher utilization, slightly higher operating expenses and depreciation, higher equity income from our joint ventures and slightly lower A and G coming in at 18.3 percent.
Next slide, please. In The U. S, we saw higher utilization and throughputs on volumes, increase in lease capacity as well as higher warforged cleaning and railcar activity. So a nice pickup in The U. S.
Gulf. In Santos, we saw higher throughput and utilization remained stable. European terminal had lower throughput, but again, pretty stable performance even with a slightly lower throughput. The Australia terminals, utilization stable, the high throughput. The New Zealand performance was flat compared to prior quarter and utilization stable.
We saw a slight down less utilization than joint venture, but the wholly owned terminals, again, utilization picked up. Next slide, please. So tank containers. This is really where we saw a significant pickup compared first and second quarter, where we had $300,000 higher transportation revenue. That was up by SEK18.3 million, and that was driven by more shipments at an average rate increase of 6.1% on the freight revenue.
We had a slightly higher demurrage, but the Ocean cost increased with the rising shipment and carrier constraints, which are passed through to customers with lag, as we have said before. Move expenses per shipment increased by 3.5 in the second quarter. So we had a lower repositioning slightly lower repositioning cost this quarter. We had higher other operating expenses in A and G. We again, the work amount needed to do a shipment now because of the issues that we have we see in the container lines, there's a lot of rework that needs to be done because we are bumped up from one ship to another ship and all the paperwork needs to be done.
So we have hired quite a few additional operators to be able to handle that extra activity. Slightly higher equity income from our joint venture, bringing the operating profit to $12,500,000 Next slide, please. The demand continues to grow across all of the markets and sectors as the economies begin to rebound from COVID. We are seeing as you see from the shipment increase, we are seeing strong demand for the shipment of products in tank containers. In order to meet demand, SDS has also placed an order to purchase an additional 1,000 tanks, that will be delivered at the end of this year and into 2022.
Customers are increasing production to meet their demand. And as a result, of course, that means our demand is also picking up. The container ship capacity constraints continue while demand keeps growing. Supply chain transits are lengthening. So it is because of the port congestions, the transit times are taking longer.
The February cold snap, like in tankers and in terminals, the cold snap in The U. S. Gulf and the Suez Canal closure and the recent congestion in Tianjin in China have been causing supply chain disruption and an increase in transportation and demurrage costs. So you can see then the last twelve months, the number of shipments and the quarterly statements of the number of shipments. So you can see a nice growth development.
You can see in the bottom graph here, this is a new part, which we're showing you the percentage of revenue per shipment has not been growing as fast as the percentage increase in the transportation cost per shipment. But again, that is with the lag. So you can see the growth in the transportation cost per shipment grew, but it's been coming down. And we have been steadily been able to pass it on. So we're seeing the revenue growth per shipment has been going up.
Next slide, please. The global seaborne container trade is expected to grow by 6.6% in 2021. So this is very much driven by the container lines, while the container ship fleet growth is expected to grow by 4.5%. So you see that growth is higher than the new supply of tonnage coming in. The high demand for capacity allocation and the disruption in congestion in ports since the 2020 are causing an increase of the ocean freight rates across the markets, which is expected to continue into 2022.
And the new capacity, we've seen that the containership order book has increased from 8.3% in November 2020 to 18% in May 2021. But those that new addition of container capacity, as you know, will not come into the market until 2022 and beyond. We are also the challenge with the availability of quality drivers and trucks is becoming challenging in multiple markets. So we expect that transportation will continue to rise and that additional cost will be passed on to our customers, and we're trying to pass them on as fast as we can, but there always is a lag. Customers are moving away from the unsustainable Flexibags to tank containers.
The Flexibags is where you put a big plastic bag into a conventional container box, but our customers are seeing the dangers of shipping in Flexibag and seeing the leakage coming from it. So we are seeing more of the products moving from Flexibag into tank containers due to the global dry box shortage and focus on sustainable supply chain. So when there's a shortage of these boxes to put these plastic bags in, of course, that also put pressure on them to come over to tank containers. Sustainability in the supply chain, SDC has established its own sustainability goals, as I showed you earlier. Demerge tank container costs have been rising and demerge has remained low.
Higher demurrage rates and reduced number of free days is expected to incentivize faster tank container returns and generate higher revenue. So what has happened, traditionally, the customer receives a certain number of days, which they can have on discharge port to be able to take the container from the port to their factory to discharge it and return it. If they use more time than what is included in the contract, they pay the merge. We have seen and that's one of the reasons that we have seen historically low results in STC. We have seen that the merge rate revenue has come down because of the blockage and because of delays caused by the congestion and the shortage of the container ships, we have seen the customers, once they receive the tanks, they take the tank right away and because they are desperate to get the product into their factories.
However, subsequent to the second quarter, we are now seeing demurrage rates demurrage revenue picking up. We continue to spend a lot of time and resources in our digital platform. Recent investment in systems in system application and digital platforms are key to offer improved flexibility and faster response times to our customers' demand. And direct integration with our customers and vendors is key to improve their operational efficiency, increase scale and higher returns per shipment. Next slide, please.
Sea Farm. So we had an operating profit of CHF 1,000,000 in the first quarter. We had lower sales in the second quarter, again, because of the seasonality. We had higher sole sales because of the increased volume that we're getting out of our new Salvo Recirculation farm in Spain, slightly higher operating expenses and higher AMG, bringing the operating profit of 0.6% negative for the quarter. The higher AMG is also driven by the cost for the we went out and explored the opportunity over the possibility of doing an IPO of Stolt Sea Farm.
Next slide, please. Subsequent to the ending of this quarter and what we are seeing right now is a strong recovery in demand, and we expect that to continue. One, of course, they're opening up quite fast now in Southern Europe. So we are seeing an exceptionally strong demand this year. Actually, the prices are increasing as we speak because of this increased demand.
One, it's okay. Restaurants are opening up, Wildfish is over, but I also think there is an impact of the dispute between us. You know, usually, supply from The UK is not as big into the European into Europe as it used to be. So we are seeing some very strong price increases both in Turbot and in Seoul, and we expect that to remain. The two RAS, the recirculation farms in Salvo and Torsha are both forming beyond our expectation.
And the first harvest from Torcha, so that's the one in Portugal, we are expecting to be four months ahead of our schedules. We are actually expecting to harvest our first fish out of that farm in already in August. Our expansion plans continue with the next stage focusing on the Salt Broodstock expansion and the new hatchery. So the growth plan that we have in Salt Sea Farm remains and are basically on track. Next page, please.
Stolt Nielsen Gas, that is basically our investments in Avenir. We are 47% ownership of Avenir. And I remind you the strategy there is the mission is to provide assets and expertise to unlock stranded LNG demand, bringing clean, affordable and reliable energy to new markets by shipping and storing LNG. We have our investment program, which is due to be completed by the end of the first quarter of twenty twenty two. We have two LNG ships that are already on charters, with the remaining four to be delivered by the end of first quarter twenty twenty two.
And the new terminal in Sardinia, we will start commercial operation, I think, within this month of July. It is a strong or robust operational outlook. There is a lot of activity going on and a lot of inquiries. So the commercial pipeline remains robust and well diversified across segments and geographies. Strong fundamentals with significant acceleration in LNG adaptation as a marine and bunkering fuel.
I remind you that we have injected the shareholders have injected €182,000,000 and we including debt, we'll have a total investment of $330,000,000 investment program based on our current asset portfolio. That is then against six ships and the terminal in Sardinia. And I just wanted to give you an idea of what kind of earnings we see coming from Avenir. And I would say quite realistically, if we just say that we even though our long term goal is to become a supplier of LNG to stranded demand, not only being a shipping company, but if we take and fill up all those four six ships that we have being delivered by the 2017 and use the rates that we are seeing in today's market, the EBITDA out of that business alone, just those six ships will be in excess of $40,000,000 And then, of course, once we are able then to develop these supply agreements, then the EBITDA is on top of that, and we are working on several very interesting and exciting opportunities there. So if you then I don't know what kind of EBITDA multiple that you would use, but if you did the calculations yourself and put whatever multiple you want on that business, you will see that I think last traded was at around SEK 8 per share.
I think that does not reflect what we're seeing as the earning potential in this business. Next slide, please. Yes, over to you, Jens. Thank you.
Thank you, Nils, and good morning and good afternoon to to all of you. I will, as normal, review the financials as reported and including cover a few key balance sheet items. I'd also want to remind you that we have today also posted the earnings release, the interim financials, as well as this presentation on the company's website, which is www.stoltnielsen.com. And also, as a reminder, that the second quarter runs from March 1 through May 31, so it's a slightly skewed quarter. If I could have the next slide, please.
If you as mentioned by Nils, if you look at the second quarter, you saw increases of activity across the three logistics businesses following what was what is really a seasonally weak first quarter because of the winter weather. But unfortunately, profits did not keep up with the improvement in activity. And as such, you saw operating profit was therefore up only slightly by 5,400,000 to $41,400,000 which was up from about $36,000,000 in the prior quarter before any one offs. Now there's you will note that there were very few one offs this quarter as was last quarter. Much of that is due to a lot of cleanup that was done on our balance sheet last year where we took some impairments down in Australia of goodwill, and we cleaned up the caviar business, and we hope that there will be less of these going forward.
Looking at the year to date operating profit before one offs, it was slightly down from the first half of twenty twenty. That was due to the lower AMG in 2020 as we introduced, if you recall, significant savings initiatives related to the COVID nineteen pandemic outbreak and also had lower profit sharing accruals because of the worry about what might happen from the the COVID nineteen pandemic. Looking at interest rates, they were down by about a million dollars, as I mentioned earlier. And you will recall that in March, we had a bond that fell due that was about $154,000,000, and that has, coupled with the general reduction of interest rates in the market, reduced our average interest rates down to approximately 4.3%. And I'll come back to that a little bit later.
During the quarter, we had a gain on FX paper hedges of about $1,000,000 and also income tax increased by 600,000 approximately, and that increase mainly reflects increased withholding tax on a dividend that we got from one of our joint ventures. Net profit, therefore, was up by $5,300,000 to $7,800,000 and EBITDA was $116,000,000 as you will see at the bottom of the first column. That's up from $108,000,000 in the prior quarter. And if you compare to the same quarter last year, the net profit increased by 4,800,000 due to the a 9,300,000 write off, but the EBITDA was higher in the prior quarter. And that 9,300,000.0 write off related to losses at Stolt Sea Farm, particularly in the caviar business.
If you look at the year to date, we have earned a profit of $10,300,000 That's a significant improvement on the loss of $17,200,000 that we took in the 2020 when Stolt Sea Farm, in addition to the caviar write off, also wrote down inventory value of its biomass due to the collapse of the hospitality industry that we saw tied to COVID. And but year to date, EBITDA, therefore, is pretty much in line with what was last year. If I may have the next slide, please. This slide has four quadrants, and they cover really the three of them are covenant coverage. The top left looks at our gross debt to tangible net worth.
You'll see there's a slight increase in our gross debt by about 21,000,000 to just over 2,600,000,000.0. And that was driven by the additional debt secured by the three three of the CTG ships that were acquired. Those were the three ships that we took wholly on our balance sheet where the other two remaining ships that went into our joint venture with NYK as well as additional drawdowns that we had of $75,000,000 on our short and long term credit lines. This was offset by the $154,000,000 repayment of the March bond and some other principal repayments. Now what you need to keep in mind, because those quick and math will have said, well, then our debt should have reduced.
But because of the cross currency hedges that we had on the bond, gross debt only went down a 104,000,000 because that was what was booked against long term debt, while the remaining $50,000,000 was booked against derivative liability, which is why you saw that there was a slight increase in the gross debt. Tangible net worth, the blue column that you see there, was up by $10,000,000 to $1,640,000,000. That reflects the net profit and improvement in other comprehensive income driven by pension gains and some positive currency translation adjustments. That's all on the balance sheet, and that was offset by dividend payment in May of just over $13,500,000 We have three main financial covenants in our loan agreements. One is the debt to tangible net worth, which should be at max 2.25 as adjusted for IFRS 16 EBITDA to interest expense, which is seen on the top right of minimum two:one and a minimum tangible net worth for the group of $600,000,000 The EBITDA covenants are based on the EBITDA for the most recent four quarters on a rolling basis.
And you see at the bottom right quadrant, which that the EBITDA for the last four quarters was $499,000,000 so down about $5,000,000 from what we reported last quarter. And therefore, we see that debt to tangible net worth was pretty much flat at 159 versus 158. EBITDA to interest expense was also pretty flat at $3.70 versus $3.69. And then at the bottom left, you will see that although not a covenant, but it's an important measure of our debt service capability, is the net debt to EBITDA. This increased from $478,000,000 to $497,000,000 and that's due to the added debt that I mentioned earlier as well as a slight reduction in the twelve month rolling EBITDA.
Our target remains to reduce this to below four. For those of you who want to track this going forward, you will note that when we report next quarter, the 2020 will fall off. That was a significant EBITDA quarter at EUR 144,000,000. So it is a big quarter coming off, so it puts a bit of a challenge to the businesses on improving the EBITDA for the third quarter. If you could take the next slide, please.
Looking at capital expenditures, there were, this quarter, about $30,000,000 down from a significant $115,000,000 in the first quarter when we acquired those CTD ships, but also note that this excludes drydock costs, which for tankers was $5,900,000 during the quarter. For the full year 2021, we expect to spend a further $127,000,000 which predominantly reflects the new build costs within tankers for the barge that we're building for BASF, some terminal CapEx that was postponed from 2020, construction of a new jetty at our Dagganan terminal, and investment in STC depots and tanks. The Board's recently approved the acquisition of a further 1,000 tank containers to accommodate further growth in SDC. Next slide, please. Cash generated from operating activities, as you see on the top part of this slide, was for the quarter at $90,900,000 That was marginally down, and that was because higher operating SALTs and JV dividend receipts of $8,000,000 that we experienced during the first quarter was actually offset by an increase in working capital during the quarter of about $17,000,000, and hence, we were slightly down quarter on quarter.
Interest payments were up, and this is not reflecting of reflection of debt or interest rate, but we have more we have a number of loans that are on six month rolling interest payment basis, and that typically falls in the second and fourth quarter, and that's why you have a higher interest load during those two quarters. But as a consequence, the net cash generated from operating activities were down by just over $20,000,000 from the prior quarter. Cash used in investments was $31,500,000 which included investments in JVs, and that was down quite a bit from the 119,000,000 spent. I already talked about that. And during the quarter, we raised $77,000,000 against the three CTG ships, drew down $70,000,000 on the revolving credit line.
But we also made principal payments of two zero two million dollars and that included the 154,000,000 on the bond as well as regular principal payments as well as $10,000,000 on capital leases. So net cash flow for the quarter ended up at a negative $50,000,000 The difference between the free cash flow that was reported earlier and this number is predominantly the debt repayments. And this results in cash and cash equivalents of $122,000,000 at the end of the first quarter, slightly down from the 173,000,000 that we had at the end of the first quarter. But keep in mind, then we had put cash aside to support the repayment of the March bond maturity. That gave us a total liquidity position.
If you add in availability under our revolving credit line, which at quarter end was $74,000,000 give us total liquidity position of $396,000,000 at the end of the second quarter. If you can go to the next slide, please. This is, as you're familiar with, the debt maturity profiles we have now shown for a number of quarters. And we differentiate between regular principal payments, which are shown in the very dark color. You have balloon payments in the light blue color, and you have bond repayments shown in gray.
We currently have just over $81,000,000 in regular principal payments remaining this year, so most of the debt maturity that we have for 2021 is taken care of. And the next big bond maturity is the $175,000,000 in 2022. That matures in September. So there's still quite some time before that happens. During the quarter end, we completed the conditions precedent for a new $100,000,000 revolving credit facility, which currently remains completely undrawn.
And when I mentioned that revolving credit line was $274,000,000 That includes that $100,000,000 as well. What we haven't showed you in the past is the bottom right graph, where we look at the average cost of our debt. And you can see that our interest expense and average interest rate on the debt has been coming steadily down as we have reduced our exposure to the bond market and benefited from lower interest rates in general. So if you look at the run rate, so year on year basis, we have reduced our interest expense, annual annual average interest expense by about $11,000,000, and that, of course, helps lower the average cost base for the group. Now we're in a potential high inflation environment, and therefore, could, of course, swing back up again.
But as of the May, we had fixed approximately 84% of our existing debt, which does lock in quite a bit of that gain. But as it stands, you know, as new loans come, up for renewal, we will, of course, have to renew them at whatever the market dictates at that point. But just want to share that with you. And, Nils, with that, I would like to hand it back to you.
Thank you, Jens. Key messages. We're seeing increasing activity across all of our businesses. We as we have said, we are have a positive market outlook also across all the businesses, though yet that needs to be reflected in the earnings, but we are seeing a positive trend. We are well positioned on an improving market.
We have a strong asset base, which supports the positive free cash flow. We have, as Jens showed you, a relatively robust balance sheet and a healthy liquidity position. And our focus is still we're keeping an eye on the debt level, and we'd like to continue to get that further down. We have access to competitive funding going forward, we believe. And our goal of zero harm for people and the environment is our number one priority.
Okay. So we will then start to answer questions. And I will kind of read them out and then pass it on to the right person. The first question we have is from a shareholder, and that's good to hear, had expected more gains from containers there's such a boom there. Yes, there is certainly a boom or a strong activity in the tank container segment, but we need to be patient because with this high number of shipments, with the increased cost of transporting these containers, it is just a matter of time before we're able to catch up and pass on all of that additional cost to our shareholders, and we will then continue to see, I believe, the margins improve.
I also like to remind you is that a big part of our business in the Tank Containers segment is also like wind tankers, we have contracts. And these are multiyear contracts that we have in installed tank containers. And some of these contracts, you don't really are you're not able to adjust the price. We only adjust the price on the service for six months. So when we see increased transportation costs from the container lines, we have to bear that cost until the new rates come in and when they're adjusted, and that we do twice a year.
And that is a significant part of our business. And of course, that also helps us when the market changes. So long term, that's the right strategy. The results will come, just takes a bit of time. But it's extremely positive, the situation and the activity that we're seeing.
And we don't see access to the contrary, we're seeing continued demand, growing demand for the transportation of our shipments. Next question, also another shareholder. DNB have a S and I recommendation, but say stock is a value trap. There are good values in the company, but the stock is topping off at 130 for many years. Yes, it's been topping off at 130, but we haven't had a good shipping market for many years.
And I would expect that once we start seeing an improvement in the shipping market, I do believe that, that will be very quickly reflected in the market. Also, we mentioned earlier, we have considered the value trap being we have so many underlying things in our company that is of value that is not reflected in the share price amongst other Stolt Sea Farm. And we did explore the opportunity to do an IPO of Sea Farm in the beginning of the year. But we felt that in January, February, March, there was such a huge amount of activity, companies trying to do an IPO raising equity. So we felt that we didn't get the necessary attention that we need to be able to sell our story and the prospects that we see in both Turbot and Seoul.
It's relatively small deal, so I think that the market was prioritizing big deals that could be done with a simpler and easier story. So we will continue to explore. I think as we have said all along, we don't need to do an IPO of Stolt Sea Farm. We don't need to do an IPO of Stolt Tankers. The conditions needs to be right.
It needs to be at the right time when both for the shipping market, but also the right time for the equity market. And it's important for us that it's a fair price, both for the potential buyer, but also it needs to reflect underlying values. So after the summer, we will continue to explore the opportunity for doing an IPO Farm. And hopefully, that will and the only reason to do an IPO of Sea Farm the growth plan that we have for Sole Sea Farm, we can handle with our own cash flow, both in Salt Sea Farm. And if Salt Sea Farm needs any more support, they can get it from Stolt Nielsen.
So the only reason that we are doing or considering doing IPO of Salt Sea Farm is to make that underlying value more transparent for the stock mix and shareholders. Lucas, this one is for you. If you unmute, you can just answer how much must the product tanker rates have to rise in order to avoid spillover effects into the chemical fleet?
Yes. Thank you, Niels. I think then we primarily look at the mid range tankers, of course. If you look at the current earnings per day, it is sort of around the 7,000, which is off the historic low that we saw in in the months of of May, which was more around 5,000. However, for that segment really to move out, we would expect around 14,000 to 15,000, but the tankers will start to move out at around the 10,000 level or so.
If I can just add one more comment to that, if you look at the broker expectations of this segment, they sort of expect quarter four earnings to be around €17,000 So it sort of gives us that sentiment that, yes, it is the time is coming that they will start moving out.
Thank you, Lucas. The next question I think I can answer is, is the acquisition done with JO Tankers? That was completed in 2000 and that was done in 2016, And the integration has been fully done and all the synergies taken out. Will it mostly be joint ventures from now on? No.
One of the reasons that we are or the main reason for us considering doing an IPO or wish to do an IPO of Stolt Tankers is to make Stolt Tankers a stand alone company so that we can make it easier to, of course, value Stolt Tankers, but also explore opportunities of both joint ventures, acquisitions and mergers. So it won't mostly be joint venture. It will be acquisitions. It will be we look at we are interested in seeing if we can further consolidate this industry. That was a big part of the reason of doing IPO.
So tankers is so that we are in a position to both to use cash and shares in an acquisition, but also in merger. Next question is in the press release this, Lukas, is for you. In the press release, it was stated that bunker costs were up by NOK 10,800,000.0, and then he quotes us, the improvement in revenue mentioned above was offset by NOK 10,800,000.0 increase in bunker cost. Why is the increase lower in slide nine bunker costs?
Yeah. That's a good observation from a sharp reader. I think the so the difference between the 10.8, the one you saw on slide eight nine is is sorry. It's what I said is the natural hedge that we have because of the the contractors. So if you look at our surcharge revenue, in quarter one, it was around 50,600,000.0, and in quarter two, it went up to €54,200,000 And that differential of 3,600,000.0 that explains the difference between the two numbers.
Thank you very much. Then we go to the next question. Jens, this is the first part is covered by for you it's for you. You repaid NOK 1,000,000,000 in March, and you have a U. S.
Dollar bond coming up for maturity in September year. How do you view the outlook for refinancing these in the current bond market?
Bond market has been giving us a lot of flexibility, and we are in constant contact with the market so that we understand where we can appraise ourselves. What is nice with the bond market is that it's cash flow benign and that you don't have principal payments until the balloon at the end. And we like to maintain that kind of flexibility, and therefore, the intention is is to maintain the kind of maturity profile that we have in the market. We wanna get away from the big issues that we've had in the past where we have had up to $200,000,000 maturities, but keep it more in a hundred and twenty five, hundred fifty, and and so steadily rolling. So the intention is for us to be back in the market when the timing is opportune, but we won't go too early because then we have to carry that on our books for a long time.
Thank you, Jens. Then the second part of the question, could you give an update on the strategic initiative in Stolt Sea Farm and Stolt Tankers? Are public listings with certain cornerstone investors still the goal? To start off with Sea Farm, I just mentioned that, yes, it is. We are not in a rush, but we want to make certain that we find the right shareholders that understand the potential of what we have created.
So we will continue our efforts in Stolt Sea Farm. And in Stolt Tankers, we have worked since 2017 in separating out Stolt Tankers as a stand alone entity and cleaned up the corporate structure there. Lukas has come on board and built up a team, and we are basically ready to go for an IPO. But again, it needs to be under the right market conditions. To sell something in today's market, I don't think, is the right thing to do, and it's also we don't have to do it.
So yes, we are we'll do an IPO of Stolt Tankers, both Stolt Sea Farm and Stolt Tankers at the right time. And hopefully, Stolt Tankers IPO will be sooner. I really do it. As Lucas showed you and as I very carefully started to say that I'm quite bullish about the situation in the chemical tanker segment going forward. So hopefully, that opportunity will arise sooner rather than later.
Next question. You are ordering 1,000 tank containers. What is your current and targeted market share in this business? How much capital would you like to deploy here given it is your most profitable segment from a return on ROA perspective? So a tank container costs anything from $15,000 to $20,000 to build.
So we're not talking about a lot of money. It is more what utilization you can have on the containers that you buy. So we are basically growing as fast as we can. And Mike and his team are doing a tremendous job in growing the fleet and really ordering or leasing new tank containers is we will go as fast and grow as hard as we can, and we will continue to do so. But of course, we need to be able to maintain the utilization.
If the utilization falls off, there's no reason to add additional tank containers. So we have bought I think we bought 2,000 last year. We have bought 2,000 for this year and next year. And most likely, either we will buy and continue to lease more tank containers as we go along. Could you offer some more comments on the risk from port congestion and COVID related disruptions, etcetera, to your businesses and an expected earnings recovery in second half twenty twenty one, 2022?
I'll give it to Lucas.
Yes. Thanks, Niels. I think, of course, there is port congestion out there right now, and it's primarily around Southern China, which is the Yanchan, Shaqou, Shenzhen area. And as you all know, that's not necessarily where salt tankers is. STC will have some impact of that.
But if I look so so I'm not concerned with port congestion, maybe some concerns around around the Panama Canal, congestions over there, but it's not yet material. I think the the biggest, impact that I now foresee on COVID related disruption is still related to the seafarers and the ability for us to change the cruise, as quickly as as as we would want. And there, we primarily see cost increases, and we see the the the cost of flights going up, particularly towards into to Manila. The I think for an economy ticket, it's already a $2,000 charge these days, so that goes up. And and we also see that because of the situation of the pandemic in Manila, that a lot of shipping companies are going to different, countries for getting their seafarers.
And therefore, we see increases in the salaries of seafarers. So that's the only thing I see right now, but I don't think there is a material impact on the expectation of the earnings recovery for stock tankers in this respect.
Thank you very much. Unless there are any further questions, that was the I don't see any more new questions coming in. So thank you very much for participating. Thank you, Lucas and Jens, for your excellent job. That completes our second quarter earnings release.
Thank you for joining us, and I wish you all a healthy and relaxing summer. Thank you.
Thank