Good morning, everyone, and welcome to Solstad Offshore's third quarter 2026 presentation. The presentation will be held by Kjetil Ramstad, CFO, and myself, Lars Peder Solstad, CEO. There will be a Q&A session after the presentation, so please send in your questions in the chat. Overall, we are pleased with the continued solid performance of the company during the quarter. Let me take you through the main developments we have had during the quarter and year to date. A quick look at the disclaimer before we move on to the company highlights. The third quarter was another quarter with solid operational and overall performance for Solstad Offshore. We had a total adjusted EBITDA of $41 million compared with $29 million in the same quarter last year. Operational EBITDA, adjusted EBITDA, was 17, slightly below the 19 we had last year.
At the same time, our joint ventures and associated companies contributed with $24 million in this quarter compared with $10 million last year. In September, we completed the sale of the Normand Tonjer, where we had an ownership of 56%. This generated an accounting gain of about $24 million, and making a significant contribution to our cash position. After the quarter end, we declared the $125 million purchase option for the Normand Maximus, with delivery scheduled for October 2027. Our intention is to finance the purchase price through external debt financing. Also important, the previous letter of intent that we have announced for Normand Maximus has now been replaced by a firm 26-month contract with Saipem, giving the firm commitment well into second quarter 2029, and with the additional 11 months of options thereafter.
Finally, we are distributing a dividend of $0.3 per share this quarter, corresponding to approximately $25 million. Overall, we continue to combine solid operations with strategic investments and attractive shareholder distributions. Kjetil, can you take us through the details on the numbers?
I will do that. Let's have a look at the financial and operational summary. The fleet utilization was 92% in the third quarter of 2026, compared with 97% in last year. Year-to-date utilization has been 85%, compared with 97% last year. The main reason for the lower utilization year to date was delayed startup of a long-term contract with Petrobras for the Normand Topazio, and idle time for Normand Tonjer in the first quarter. Operating income was $125 million in the quarter, up from $73 million same quarter last year. Year-to-date operating income was $316 million compared to $220 million last year. Third quarter includes $24 million accounting gain on 100% basis from the sale of Normand Tonjer. Underlying income has also increased year on year, driven by higher number of Solstad Maritime vessels operating through Solstad Offshore's Brazil setup.
However, this has limited impact on the operational adjusted EBITDA, which was $17 million in the quarter, compared to $19 million in the third quarter of last year. Also mention the $5 million reduction compared to the second quarter this year. That is mainly because of a legacy disputed charter hire of $5 million that was recognized in the previous quarter. Year-to-date adjusted EBITDA has been $116 million compared with $91 million last year, with the increase driven by improved share of results from joint ventures and associated companies. Net result was $63 million in the quarter, compared with $26 million last year. Year-to-date net result was $130 million, up from $88 million last year. Book equity at the end of the quarter was $528 million, corresponding to an equity ratio of 47%, compared with $375 million or 44% same quarter last year.
The adjusted net interest-bearing debt, excluding the present value of the Normand Maximus purchase option, was in a cash-positive position of $39 million at quarter end, compared with a net debt of $57 million last year. Cash at quarter end was $151 million, compared to $87 million last year. The solid cash position supports the extraordinary dividend related to Normand Tonjer sale, while retaining liquidity for the upcoming vessel maintenance and expenditures and corresponding off-hire periods. If we go to next slide, on the debt overview for Solstad Offshore, the company has a $70 million term loan facility, unchanged from second quarter. It was drawn in November 2024 and has a five-year amortization profile, matures in November 2027. Solstad Brazil term loan of approximately $40 million at the quarter end, and this is for the financing of our four Brazilian-built vessels through BNDES.
Maturity is between 2026 and 2031, limited schedule amortization in the coming years. The Normand Maximus lease liability of $144 million, consisting of $30 million of remaining bareboat lease through October 2027, and $114 million representing the present value of the declared $125 million purchase option. The other liabilities of $227 million, the majority, $223 million, relates to Solstad Maritime vessels operating through Solstad Offshore Brazil setup. These lease agreements are supported by contracts with Brazilian end clients, and the remaining $4 million relates to ROV and property leases. Net interest-bearing debt was $332 million at the quarter end. Adjusted for leases related to Solstad Maritime vessels and excluding the present value of the Normand Maximus purchase option, the adjusted net interest-bearing debt was in a positive cash position of $39 million.
Total interest-bearing debt and lease liability decreased from $505 million at the end of second quarter to $483 million at the end of third quarter, mainly reflecting the lower lease commitments. With that, we will have a look at the dividend in Solstad Offshore for the third quarter. The company will distribute a cash dividend for the third quarter of $0.3 per share, totaling approximately $25 million. Of this, $0.12 per share, or approximately $10 million, is considered as an extraordinary dividend following the sale of Normand Tonjer. The dividend will be paid in NOK, and the NOK amount will be announced prior to the payment. Key dates for the third quarter dividend, last day including right to receive dividend, 5th of November 2026. The ex-date, 6th of November 2026. Record date, 9th of November 2026.
Distribution date on or about 20th November 2026.
Thanks, Kjetil. Let us have a closer look at the investments that Solstad Offshore has in associated companies and joint ventures. They all represent a substantial source of both earnings and underlying value for the company. Solstad Maritime contributed around $22 million to our result in the third quarter, and our 27.3% ownership generated approximately $15 million in third quarter dividend income, while our share of the market cap was approximately $380 million at quarter end. This compares to a book value of the shareholding of $263 million. Omega Subsea continues to develop positively. The company currently owns 20 ROVs, with another 10 scheduled for delivery 2027 and onwards. Over the last 12 months, the company generated approximately $100 million in revenues and about $32 million in EBITDA.
We have also our two 50/50 joint ventures with SBM Offshore, where Normand Installer, our vessel that operate or continue to operate on her contract with SBM, while the new build scheduled for delivery in the first half of 2029 will, upon delivery, start on a 14-year contract with options for another 11 years thereafter. Combined, our joint ventures and associated companies contributed with about $24 million to the result this quarter. Compared with $10 million in third quarter last year. These investments provide a combination of earnings, cash distribution, and long-term strategic value for Solstad Offshore. Turning briefly to the market, the overall demand picture within offshore energy remains positive. Brazil continues to be predominantly a long-term contract market for the anchor handlers, although the vessels with spot exposures are achieving decent utilization.
We have three anchor handlers in this region, and all of them are on long-term contract. Normand Turquesa, which is one of them, will do her dry docking in first or end of fourth quarter and also into first quarter, ahead of her new four-year contract with Petrobras. The CSV market remains active and project-oriented, but also with some longer-term opportunities. We continue to see a high fleet utilization, but there will also be some more vessels entering the market the coming year and a half or so, with quite a few new buildings be delivered. For our fleet, we will see both the Normand Maximus and the Normand Superior doing their 10-year classing in first half of 2027. Normand Maximus will continue her Saipem contract thereafter, while the next job for Normand Superior has not been firmed up yet.
We have several prospects we are working on, but nothing is firm at this moment. Geographically, South America, as I mentioned, a very important area for Solstad Offshore, but we also see activity in other areas of the world, where West Africa is an important area for us, and of course also the North Sea. Brazil, as I mentioned, of course, also Suriname, Guyana included in the areas where we see a lot of activity. At the moment, we also pay special attention to the Black Sea area, where there is a security, let's say, call it a security situation, and some of our vessels, or one of our vessels are operating in this area at the moment. As mentioned, for Solstad Offshore, Brazil remains particularly important, and our local established organization and the vessels operating through our Brazilian structure give us a strong footprint in this market.
Having a look at the backlog, the backlog provides good earnings visibility for us the coming years. We have the firm backlog for Solstad Offshore for the owned vessels was around $400 million at quarter end. In addition, around $560 million of backlog is related to the Solstad Maritime vessels operating through our Brazilian structure. For our own fleet, 95% of the days are already firm for fourth quarter. Looking into 2027, 85% of available days are already firm, providing a high degree of earning visibility. Normand Maximus is reflected with its planned class renewal in first quarter, followed by the new contract already mentioned. The combination of backlog for our own vessels and the Solstad Maritime vessels operating in Brazil provide us with substantial visibility into the coming years. Kjetil, can you say a few words about the guidance?
Yeah, I can do that. The financial guidance for remainder of the year, and the operational adjusted EBITDA guidance remain unchanged at $60 million-$70 million, where we have already $51 million that has been generated year to date. The guidance assume that Normand Maximus remains on contract to the year end before commencing its 10-year class renewal. The guidance also excludes the share of results from joint ventures and associated companies. As mentioned, for the third quarter, we will distribute a cash dividend of $0.3 per share, totaling approximately $25 million. $0.12 per share, or approximately $10 million, is considered as an extraordinary dividend following the sale of Normand Tonjer. With this, I give the word back to you to summarize, Lars Peder.
Yeah. Thank you. To summarize, this was another solid quarter for Solstad Offshore. We delivered a total adjusted EBITDA of $41 million, supported by a strong contribution from our joint ventures and associated companies. The sale of Normand Tonjer further strengthened our cash position and enabled us to return part of the proceeds directly to shareholders. We have also taken an important strategic step by declaring the purchase option on the Normand Maximus, while also securing employment for the vessel into second quarter of 2029, plus options thereafter. Our contract coverage provides a good earning visibility, with 85% of the available days for our vessel already firm for 2027. Finally, our strong financial position allows us to distribute approximately $25 million to the shareholders for the quarter.
Solstad Offshore is a financially robust investment and operating platform, combining contracted vessel earnings with valuable industrial investments while maintaining the capacity both to invest and to return capital to shareholders. With that, I conclude the presentation, and we move over to Q&As, Kjetil.
Yep. We have quite some questions incoming. Let's start with, given the large inflow of new builds that is coming into the market over the next years, are you worried that some of the uncommitted vessels that we have in Solstad Offshore, like Normand Superior and others, will struggle to find new commitment, and are there prospects in the pipeline?
There are definitely opportunities in the market, both project-wise and also, as I said earlier, that there are also some longer-term opportunities that are being bid. I am not concerned about the Normand Superior position. We have a few leads that we are working on at the moment, and are quite optimistic to secure some of those opportunities. I think what we have seen so far is that the supply side of this business is fairly disciplined in terms of rates. All the, let's say, the processes we have been involved with, we have seen that both bidding and fixtures has been done on good levels.
Thank you. In continuation of this, what is the future for Normand Carioca when this vessel eventually comes to an end of the current contract?
Yeah. We still have more than a year left of this contract. We are bidding at the moment, actually, for a continuation or in the same position. The vessel also is Brazilian-built, has Brazilian flag. We have a good position in the market in Brazil, so we will be able to secure work for the vessel, either with present client or with someone else when that vessel comes available in more than a year from now. I am not concerned about that, no.
Thank you. Over to Normand Maximus. As you mentioned in the presentation, this vessel is going to be dry-docked soon. Can you say something about the length of the dry-docking project and also the cost?
Well, we will say more of the overall CapEx guidance for Solstad Offshore when guiding for 2027. I am not going to go into that right now, but we expect to be out of the, let us say, out of the market for about 60 days or so for the dry-docking in first quarter.
Thank you. A question on dividends. Given the solid backlog of the company over the next few years, can we expect dividends distribution in the area of what we are looking at now going forward? What is the company's perspective on this?
Well, it will always be an ambition for us to distribute dividend on the highest possible level. That always has to be linked to the company's performance. We are increasing again this quarter. We also have a very solid cash position. We have a solid contract coverage, but we also have about half the fleet going into class renewals in first half of 2027. So it is about combining the solid cash or the dividend level, but also making sure that we are preserving cash also for the upcoming maintenance activities. So it—
Yeah.
—is a balance there.
Over to the new build with SBM. Is there a need for the company to contribute more equity into the project?
Well, there is a During the I would say the equity contribution that we are going to contribute with in total is going to be fairly limited from Solstad Offshore, reflecting the, of course, the structure of the deal we have with the yard, but also reflecting the long-term commitment we have and the strong partner we have. So it is going to be fairly limited equity contribution.
Yeah. Thank you. We are at the last question. You mentioned that the purchase option of Normand Maximus was declared, and also you mentioned that we plan to finance that through external debt. Can you elaborate a little bit more on this? Would it be a bank loan or would it be
Yeah.
Well, of course, the purchase option in itself was kind of a no-brainer. The vessel is well in the money. We have a contract in place. The replacement value of this vessel is several times higher than the purchase option price. So that is a no-brainer in itself. We also see that the interest from lenders are on a high level, so we are confident that we can finance the full amount with external debt, and bank debt will be the natural for us to do.
Yeah. Thank you. That concludes the Q&A for today.
Okay. So thank you very much to everyone who listened in, and we wish you all a nice day ahead. Thank you very much.
Thank you.